Average SNAP (formerly food stamp) benefits fell by about 7 percent due to last November’s expiration of the temporary benefit increase in the 2009 Recovery Act, according to our updated paper. This reduction, which matches our earlier prediction, will have a powerful impact on low-income households’ ability to afford adequate food — and on local economies.
Most SNAP recipients already had difficulty affording food, and the lost benefits equal about ten meals a month for an average SNAP household. Because SNAP households spend 97 percent of their benefits by the end of the month, the reduction will likely cause more households to run out of money for food. News reports indicate that food banks have seen a rise in need since the cut took effect (see here, here, and here).
Agriculture Department research shows that a drop in SNAP benefits can raise the number of households with “very low food security,” meaning that one or more persons had to skip meals or otherwise eat less because they lacked money.
The total benefit cut exceeded $400 million for November alone and will amount to about $5 billion over the rest of fiscal year 2014. To put that in perspective, $400 million roughly equals the entire fiscal year 2014 federal funding for emergency food assistance delivered through food pantries and other sites.
Because SNAP recipients spend their benefits quickly, the loss in benefits will ripple through states’ economies. Moody’s Analytics estimates that every dollar in SNAP benefits generates at least $1.70 in economic activity in a weak economy.